The major strategic review of Defence that our Government unveiled in July was always going to mean that – in terms of headline-grabbing announcements at least – Defence was not going to be front and centre on Federal Budget day.
We largely knew where the money was going, and at first blush the Budget did for Defence what it was expected to do.
It cemented funding over the next four years for our $575 billion decade-long spend.
That includes an unprecedented $270 billion capital investment program to provide the men and women of the Australian Defence Force with the capability they need to protect all Australians.
As one Defence writer noted last week, these are “rivers of gold”.
Coupled with a $1 billion stimulus package the Morrison Government unveiled in August to boost the economy and underpin 4000 jobs, defence industry was already well placed to help lead Australia out of the COVID-19 recession.
But the benefits for defence industry that will flow from the Morrison Government’s Budget extend well beyond the pledges that had already been made in the 2020 Defence Strategic Update and 2020 Force Structure Plan.
The jobs-creating commitments that did make headlines across the country will benefit few parts of the national economy more than our defence industry.
The Treasurer delivered an extraordinary plan to create more Australian jobs by lowering taxes, kick-starting investment in the private sector and ensuring Australians have the right skills and training to drive our economic recovery.
Indeed, he delivered the most significant business incentives ever delivered by an Australian government.
For our sector, this means that more Australians will be employed in defence industry and have new skills and training to deliver our Defence capability.
And I want to ensure our defence industry is well aware of the extraordinary opportunities before it.
As the Treasurer explained last Tuesday night, more than 99 per cent of businesses will be able to write off the full value of any eligible asset they purchase.
In the private sector, which the Treasurer rightly called the “engine of the Australian economy”, this temporary tax incentive is all about kick-starting investment.
It is a "game-changer" that will mean our small, medium and large defence industry businesses will be stronger on the road ahead.
As a Government we are also allowing companies to offset losses against previous profits on which tax has been paid, to generate a refund, providing greater cash flow support.
And in another opportunity for our sector, we are exempting from the fringe benefits tax, employer-provided retraining activities to employees who are redeployed to a different role in the business.
This initiative should be music to the ears of businesses in our defence industry.
It should encourage them to help redeployed workers transition to a new role inside or outside their business.
These are just a snapshot of the measures of support for Australian businesses that our growing defence industry has an opportunity to take advantage of.
Because by doing that, you will help us achieve what we have set out to do in this Budget: create thousands of Australian jobs.
While the COVID-19 pandemic has cost many people their jobs, it has also created a positive environment for the retraining of our workforce.
Our $1 billion stimulus package unveiled in August included increased funding of more than $110 million for Defence innovation, industry grants, skilling and micro credentialing, and cyber training for Defence industry.
The Skilling Australia’s Defence Industry Grants program, to which we have committed $39 million over the next three years, provides defence industry with the support and confidence it needed to embark on the upskilling of its workforce.
But our Government went much further in its commitment to developing new skills, traineeships and apprenticeships in the Federal Budget.
New trainees and apprentices will have half their wages paid by our Government for 12 months – a $1.2 billion scheme that we expect will deliver 100,000 jobs over the next year.
This builds on our $1 billion JobTrainer fund so that we can get more school leavers and job seekers into defence industry jobs.
I want to work with our partners in the defence industry to bring more apprenticeships and traineeships into our major Defence programs.
Because our investments, particularly in shipbuilding, means we know that we will need to grow our 70,000-strong industry workforce.
And what better way to do that than by attracting apprentices to the sorts of exciting careers that defence industry presents.
The COVID-19 recession has undoubtedly presented many challenges for businesses across the country.
But our defence industry has been remarkably resilient in keeping our Australian economy moving.
I am more confident than ever that last week’s Budget will ensure this continues, and that defence industry will be front and centre in Australia’s economic recovery and the creation of jobs.
As published in Defence Connect on 13 October 2020: https://www.defenceconnect.com.au/key-enablers/6991-op-ed-a-budget-of-opportunities-for-defence-industry